Who decides what cars Canadian dealers sell?

But the disappearance of the Mazda2 from the Canadian market is stark evidence of how the landscape has changed north of the border.

Compact and subcompact cars once accounted for more than half of passenger-vehicle sales in Canada where higher retail prices, taxes and fuel costs pushed buyers towards smaller vehicles than their American cousins.

But the growing popularity of small tall wagons, which offer better utility with little penalty, has eaten into conventional-car segments, especially subcompacts.

“Subcompact cars will have the largest sales drop of all segments in 2015, down more than 23,000 estimated,” analyst Dennis DesRosiers said in his December AutoWatch Update. “The demand for subcompact SUVs has been unparalleled in 2015.”

According to DesRosiers’ figures, the subcompact-car segment was down 30 percent in November, while subcompact utility sales (categorized as light trucks) rose 157 per cent, perhaps thanks to the availability of new models such as the Mazda CX-3 and Honda HR-V.

That’s one reason behind the decision to drop the Mazda2, said Greg Young, Mazda Canada’s brand-engagement director.

It also coincided with the debut of CX-3, Mazda’s player in the subcompact segment.

“As we were going through that and preparing, we came to the realization that … the best utilization of our resources would be on the subcompact crossover, and not divert resources to the subcompact car,” he told Automobile News | tomobile.org Canada.

“We see a lot more upside concentrating on CX-3 rather than diverting our resources and splitting it between the CX-3 and Mazda2.”

Mazda has been selling between 300 and 1,000 of the more profitable CX-3s a month since its mid-year introduction, No. 2 in the segment behind the HR-V, Young said. Mazda2 sales peaked in 2011 at 9,020, dropping to 2,449 in 2014 and just 758 by November of last year as deliveries dried up.

“Looking into the future we figured this is probably a better focus for us than a subcompact car [in addition to] a subcompact SUV,” he said. “I can’t tell you what the margin is but … you realize it on a per-unit basis, but also the volume is going to be greater.”

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